There are several competitors I see every days and other competitors we very rarely see. Some of them are fun to compete against and some play dirty. The ones who play dirty always make me laugh.
So salesforce.com has a document that they email to prospects that tells them why Microsoft CRM is the wrong choice for their business.
My favorite line in there is that Microsoft spends more on Xbox R&D than CRM R&D. While I am not privy to any number to prove or disprove that, here are some numbers I do know. That the video game console business is a $30 Billion dollar a year business. (According to numerous studies I have read.)
You know how big the CRM Market space is? In 2006, the CRM market will be up to $12.6 Billion, of which approximately 37% will be from licenses. So all of the software publishers out there will split about 4.5B in CRM revenue.
Last time I checked, 30 Billion was MUCH bigger than 4.6 Billion. So it makes sense we should spend more on Xbox than CRM.
So speaking of R&D Spend, let’s talk about Salesforce.com’s R&D Spend. How about 9.8 Million in 2005, 7.0 in 2004 and 4.6 in 2003. (For a Total of $21.4 Million or so.Page 16 has the numbers if you have ADD like I do… ) How much does Microsoft spend on R&D?
“During fiscal years 2003, 2004, and 2005, research and development expense was $6.60 billion, $7.78 billion, and $6.18 billion respectively. Those amounts represented 20.5%, 21.1%, and 15.5%, respectively, of revenue in each of those years.”
So the source of that material is Microsoft’s 10k. You can find it here.
So here is the fun part of the quiz. Do you think salesforce.com’s CEO spent more on housing for himself or R&D? I ain’t that good with math, so why don’t you do it for me. J
The City House: 27 Million
The Get Away: 13.5 Million for Land
8.0 Million for Construction Costs to Date
Grand total: 48.5 Million
So that is about TWICE what they spent on R&D from 2003 until 2005 in TOTAL R&D spend and THREE times what they spent to acquire Sendia.
So I wonder where Marc’s priorities are.
06-08-06: Updated Microsoft’s R&D Spend to the offical source instead of a news article.